Aberdeen-2

[Porrohman]

BP's CEO stated late last year that they are targeting producing UK oil for less than $12 per barrel. They are currently producing for $15 per barrel, selling it for over $50 and paying no net UK corporate taxes. They are in the process of doubling their UK output according to their CEO. Shell recently paid the biggest dividend in corporate history and is paying no net corporate taxes in the UK. The Scottish Government has recently wound up its oil jobs taskforce as the industry has turned the corner. UK oil and gas output was recently forecast to be 1.9 million barrels per day by the end of next year against 0.9 million barrels per day a couple of years ago as a result of new fields coming on stream and old fields completing their upgrades. To put these figures into perspective, at the peak in the 90s, UK oil production maxed at just over 2.8 million barrels per day and the price at the time ranged between $10 and $20 per barrel. Your information is somewhat out of date Harry.

The reason for the downturn in jobs from 2014 was partly to do with falling oil prices but significantly because very generous tax incentives in the preceeding few years were slashed. These tax incentives led to record levels of investment (which are now nearing production) and a jobs bonanza but huge numbers of jobs were lost when the incentives were cut. After the massive job cuts in 2014, taxes have since been slashed again.

One of the biggest problems that the UK's privatised oil industry has suffered from in the last forty years is a hugely unstable tax regime which creates boom and bust situations. Norways's substantially state owned industry doesn't suffer from the same issue and enjoys far more stability.